We've written about Carrie L. Tolstedt before. See here: https://worldmoneylaunderingreport.com/publications/web/news/obstructin…

Now she's entered into a settlement agreement with the USA's Securities and Exchange Commission.

On 30th May she agreed to pay USD3 million as a penalty to settle the SEC's claims brought in 2020 for her role in allegedly misleading investors about the success of the Community Bank, Wells Fargo’s core business.

The SEC previously settled related claims against Wells Fargo and its former CEO and Chairman, John Stumpf.

Tolstedt, without admitting or denying the SEC’s allegations, agreed to a final judgment permanently enjoining her from breaching, or aiding and abetting breaches of, the anti-fraud and other provisions of the federal securities laws and imposing a permanent officer-and-director bar. In addition to the USD3 million civil penalty, Tolstedt agreed to surrender USD1,459,076 plus prejudgment interest of USD447,874.

The SEC says "The SEC will combine this money with USD500 million paid by Wells Fargo and the USD2.5 million penalty paid by Stumpf in previous settlements and distribute the sum to harmed investors. The settlement is subject to court approval.

"According to the SEC’s complaint against Tolstedt, from mid-2014 through mid-2016, Tolstedt publicly described and endorsed Wells Fargo’s “cross-sell metric” as a means of measuring Wells Fargo’s financial success despite the fact that this metric was inflated by accounts and services that were unused, unneeded, or unauthorized. The complaint further alleges that Tolstedt knew the cross-sell metric did not accurately track accounts or products that customers needed or used, since she was aware of misconduct at the Community Bank that led to bankers pushing products on customers that they did not need or want, including the unauthorized opening of accounts. The complaint alleges that Tolstedt made misleading public statements to investors at Wells Fargo’s investor conferences in 2014 and 2016, and signed misleading sub-certifications as to the accuracy of Wells Fargo’s public disclosures when she knew or was reckless in not knowing that statements in those disclosures regarding Wells Fargo’s cross-sell metric were materially false and misleading."

This settlement is not combined with the criminal prosecution reported previously. Nor is it combined with the settlement agreement with the Office of the Comptroller of the Currency where she agreed to pay USD17 million.